Revenue

Sponsorship, apparel and English Premier League football

Dr Armagan Omal

Posted: November 13, 2014

Football is not just a game anymore; it is completely a business and with all stakeholders it is a huge industry. This is the crystal clear fact. The amount of money that clubs are earning is increasing every year. According to Deloitte’s Football Money League report, all of the top 30 revenue generating football clubs has annual revenue more than $100 million. However, in 1996/97 report, Manchester United was the only team that had an income more than $100 million.

According to the same report, commercial revenue which includes sponsorship and merchandising revenues consist the highest portion – 42% of total revenues of the top 20 revenue generating football clubs. The share of broadcasting is 36% and the remaining 22% is matchday revenue.

The sponsorship which is one of the most significant financial resources of football attracts many different industries. This article is aiming to analyze the sponsorship in the English Premier League (EPL) which has more than £3 billion of total revenue – the highest for a football league in the world – in 2013/14 season. The study is based on the official websites of the EPL football clubs and it is done in the beginning of October 2014. Also it does not include the companies that are specified as the local sponsors in these websites.

Technical Kit Suppliers

All the EPL clubs have agreement with a technical kit supplier except Southampton. The Saints do not have such a supplier and they are using unbranded jerseys. The most preferred brand is Adidas with five clubs, and it is followed by Puma and Nike with four and three clubs respectively. Macron, Umbro and Warrior have two clubs and finally Under Armour has its only deal with Tottenham Hotspur. So, there is a German dominance (Adidas and Puma) in technical kit sponsorship with nine clubs in the English Premier League. By the way, Manchester United has announced that it will switch from Nike to Adidas with a £750 million agreement that will run for 10 years beginning in the 2015-16 season. So, if there is no change for the other clubs, the German brands will be the kit sponsor of half of the EPL.

Kit Supplier

# of Clubs

Adidas

5

Puma

4

Nike

3

Macron

2

Umbro

2

Warrior

2

Under Armour

1

No Brand

1

Jersey Sponsorship

Jersey sponsors are specified as the main sponsor or main partner. Generally, the highest amount of money is spent here by the sponsors. The seven-year-deal between Chevrolet and Manchester United is worth $70 million per year which is the highest in EPL where $1.25 million paid by Neteller (a service of Optimal Payments) to Crystal Palace is the lowest.

There is no football club without a jersey sponsor in the EPL. On the jerseys of seven teams, we see the brands of the finance & insurance industry including forex companies. Bet companies rank second with four jersey sponsorships. There are three airways companies, two electronics & digital companies on the jerseys. Alcoholic drinks, fashion & retail, automotive and food & foodservices industries have only one jersey sponsorships each.

Although, finance & insurance industry has the highest number of jersey sponsorships; with three deals, airways industry pays the highest amount of money ($87.5 M) in a year. Finance & insurance industry follows airways with an amount of $85.05 M, where automotive ranks the third with just one sponsorship with Manchester United ($70.0 M). These three industries constitute the 78% of the total jersey sponsorships in EPL. The details are in the table below.

Football Club

Jersey Sponsor

Industry

Annual Revenue ($ million)

Arsenal

Emirates

Airways

50.00

Aston Villa

Dafabet

Bet / Casino

8.25

Burnley

Fun88

Bet / Casino

1.65

Chelsea

Samsung

Electronics & Digital

30.00

Crystal Palace

Neteller

Finance & Insurance

1.25

Everton

Chang

Alcoholic Drinks

8.85

Hull City

12bet.com

Bet / Casino

2.60

Leicester City

King Power Duty Free

Fashion & Retail

1.70

Liverpool

Standard Chartered

Finance & Insurance

33.40

Manchester City

Etihad

Airways

33.40

Manchester United

Chevrolet

Auto

70.00

Newcastle United

wonga.com

Finance & Insurance

10.00

Queens Park Rangers

Air Asia

Airways

4.10

Southampton

Veho (Muvi)

Electronics & Digital

1.70

Stoke City

Bet365

Bet / Casino

5.00

Sunderland

Bidvest

Food & Foodservices

8.30

Swansea City

gwfx Forex

Finance & Insurance

6.70

Tottenham Hotspur

AIA

Finance & Insurance

26.70

West Bromwich Albion

Quick Books Finance

Finance & Insurance

2.00

West Ham United

Alpari Fx Trading

Finance & Insurance

5.00

Other Sponsors

The twenty clubs in EPL have 187 sponsors in total from 37 different industries. However, since some companies are sponsoring more than one club, the number of unique companies is 152. For instance Carlsberg is sponsoring eight different clubs, EA Sports is the sponsor of six, and Viagogo is the sponsor of four different clubs.

Bet /casino companies are the leader in terms of number of sponsorships in EPL. The number of bet /casino sponsorships is 20 which means one per football club. However Arsenal, Liverpool and Sunderland do not have any sponsors from bet/casino industry where Leicester City, West Bromwich Albion and West Ham United have two sponsors each. The number of sponsoring bet/casino companies is 13, since bet365 and williamhill.com are sponsoring three different football clubs.

The second industry in terms of sponsorships is alcoholic drinks with nine companies and 18 sponsorships. Six of these companies are beer producers. As mentioned above, Carlsberg is sponsoring eight different clubs and it is the leader within all industries and brands.

The third industry is finance and insurance (including forex companies) which has 13 companies with 15 sponsorships.

Rank

Industry

# of Sponsorships

# of Companies

1

Bet / Casino

20

13

2

Alcoholic Drinks

18

9

3

Finance & Insurance

15

13

4

Fashion&Retail

11

10

5

Airways & Aviation

10

9

6

Auto (rent & Sales)

9

9

=

Electronics&Digital

9

8

=

Tourism & Travel

9

7

9

Food&Foodservices

8

8

10

Construction

7

7

=

Game

7

2

=

Ticket

7

2

The rankings can be done in terms of the value of the sponsorship and the ranking will absolutely change, but some sponsorship agreements are undisclosed and it makes the absolute ranking impossible.

So, the most popular football league in the world attracts the attention of many companies from different industries. They spend millions of pounds to take a place on this show. Their business results will show whether these efforts have positive effect on their KPIs or not. But the increase in the amount of money spent for these sponsorships give some clue about this issue.

About Dr Armagan Omal

Armagan Onal holds a PhD degree in marketing from Bahcesehir University, Istanbul. His dissertation is about sports marketing and his main research interest is in ‘sports fan behavior’. He is a marketing instructor for MBA classes at Bahcesehir University. He also continues his professional marketing career in a GSM company in Turkey. armaganonal@yahoo.com @Sports_Mktg